Eurozone unemployment falls to lowest in four years

BRUSSELS, Belgium – Eurozone unemployment dropped to its lowest level in four years in November, official data showed on Thursday, beating analyst expectations amid lingering doubts about the strength of the economy in Europe.

The improved jobs picture comes as the 19-country single currency bloc is still stuck in a bout of low inflation and weak growth despite unprecedented stimulus measures by the European Central Bank.

The European Union’s Eurostat agency said eurozone unemployment fell to 10.5% in November from a revised 10.6% in October, hitting the lowest level since October 2011.

Joblessness in the eurozone has gradually fallen from the record 12.2% reached in September 2013 as the damaging eurozone debt crisis peaked out.

However, it still remains way above the 7.5% levels seen during the economic boom leading up to the financial crash in 2008.

In comparison, unemployment in the much faster growing United States currently stands at 5.0%.

Economists worry that growth in Europe, currently set to expand by 1.6% in 2015, is too weak to erase the big pockets of unemployment, especially Greece, Spain and Portugal, but also in economic heavyweights France and Italy.

“The number of eurozone jobless has now fallen (by) 1.57 million overall since October 2014. Encouraging, but it needs to come down a lot further,” said Howard Archer, chief European economist at IHS Global Insight.

As usual the level of joblessness, which totaled 16.9 million across the eurozone, varied from country to country.

The highest rate was in debt-stricken Greece, at 24.6% in September, the latest data available.

Youth unemployment in Greece stood at a higher 49.5% and at a still worrying 47.5% in Spain whose economy has done much better than many others.

The lowest rate overall in the bloc was in economic powerhouse Germany, unchanged for a third consecutive month at an ultra low 4.5%.

France, the eurozone’s second biggest economy, saw unemployment fall to 10.1% from 10.3% in October, a sign that a poor jobs picture could finally be improving.

For the whole eurozone, economists surveyed by the Factset data company had forecast an unemployment rate of 10.7%.

Separate Eurostat data meanwhile showed that retail sales in the eurozone fell 0.3% in November, a third consecutive monthly drop.

“The decline is somewhat surprising given relatively strong consumer confidence, improvements in the labour market and tailwinds from low oil prices, but it remains to be seen whether total consumption is in a similar slump as retail sales is,” said analyst Bert Colijn from by ING Bank. – Alex Pigman, AFP/Rappler.com